Provider group lashes out at statistical sampling in FCA cases

The American Health Care Association (AHCA) has strong feelings about the use of statistical sampling in False Claims Act (FCA) cases, as evidenced by an amicus brief filed this week in the government's case against a hospice provider.

The national association of long-term care and post-acute care providers filed the brief in an FCA case against Agape Senior Community Inc. The government alleged Agape submitted more than 50,000 fraudulent claims by falsely certifying patients for hospice services and sought to prove FCA violations through statistical sampling. The district court rejected this approach, and this issue is currently before the U.S. Court of Appeals for the Fourth Circuit.

AHCA argued "allowing sampling to establish liability fundamentally shifts the FCA's burden of proof" to defendants, forcing providers to disprove FCA liability for hundreds of thousands of claims. The association called the use of statistical sampling a "novel procedural shortcut," and urged the court to affirm the district court's ruling.

"AHCA has a monumental interest to defend our membership's basic due process rights when facing draconian liabilities, such as treble damage awards that can be imposed under the FCA," AHCA President and CEO Mark Parkinson said in a statement. "The government wants general sampling to replace specific proof as a shortcut to winning FCA cases. That will also give big government a giant sledgehammer in forcing defendants into pretrial settlements irrespective of the merits of the case. Sampling cannot be a substitute for actual proof in an FCA case. None other than the U.S. Supreme Court has already labeled statistical sampling as Trial by Formula."

Concerns surrounding statistical sampling have cropped up in other hospice cases, including a lawsuit against AseraCare, in which the Department of Justice is seeking more than $200 million in false claims damages based on a random sampling of claims. FCA recoveries dropped nearly 40 percent last year, although the government still managed to haul in nearly $1.9 million from healthcare providers. The Supreme Court is scheduled to hear arguments surrounding "implied certification," another FCA hot-button issue that providers says "lowers the bar" for fraud.